Snitching on the firm or acting in the public interest?

Ratting, squealing, blabbing, shopping - all synonyms for whistleblowing with profoundly pejorative connotations of a betrayal…

Ratting, squealing, blabbing, shopping - all synonyms for whistleblowing with profoundly pejorative connotations of a betrayal of trust.

The dire consequences of whistleblowing - when an individual entrusted with confidential information exposes wrongdoing by an organisation - are well documented. In a US study, 100 per cent of whistleblowers were fired, with most unable to find alternative employment. Seventeen per cent lost their homes, 54 per cent were harassed by their work peers, 15 per cent were subsequently divorced, and 80 per cent suffered physical deterioration.

Almost 90 per cent reported emotional stress, a sense of powerlessness, depression, isolation and anxiety, while 10 per cent attempted suicide.

A high-profile example is Mr Jeffrey Wigand, the ostracised "hero" of the movie The Insider. Mr Wigand, a former research biologist for a tobacco company broke a confidentiality agreement with his former employers to reveal on a TV documentary that the tobacco industry knew cigarettes were addictive and harmful, and deliberately worked to increase that addictiveness.

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Ironically, the TV producer, Mr Lowell Bergman, who persuaded Mr Wigand to tell the story, was allegedly pressurised by his employer, CBS, not to air the programme - following representations from the tobacco industry - and quit his job over the incident.

Why are whistleblowers so unpopular when they jeopardise their own well-being to act in what they see as the public interest? It is possible they arouse conflict and confrontation with the "establishment". Employers regard whistleblowers as disloyal and untrustworthy and question their motives while their opponents portray them as troublemakers or psychologically unbalanced.

Some whistleblowers may be malicious or fight an organisation out of an actual or perceived wrong.

Dr Andrew Millar, then head of clinical trials for British Biotech, exposed his employer in 1998 for alleged cover-ups of bad news from its laboratories and improper directors' share sales. Dr Millar had been passed over for an appointment to the board as development director and had an acrimonious relationship with the company chairman and founder. He revealed all to important institutional shareholders and was fired.

Recently, former employees have set up websites to expose malpractices in their ex-companies. But justified or not, whistleblowers tend to become pariahs. Paradoxically, these custodians of the public interest claim to be more trustworthy than the organisations they expose. They believe the company has betrayed them.

The whistleblower bears bad news, so he suffers from the "shoot the messenger" reaction. Whistleblowing signals something amiss in the organisation. Managers have failed to keep control. Scrutiny from the media and regulators follows, taking up time and energy in damage limitation. It raises questions about the integrity of all members of the organisation. No wonder the whistlebower conjures up distasteful associations among colleagues.

Business ethicists believe certain conditions should prevail to justify whistleblowing. The act should stem from appropriate moral motives of preventing unnecessary harm to others.

But inevitably motives will be seen as dubious, or understood in a self-serving way by the different sides. There must be clear, substantiated evidence that the organisation is engaged in some wrongful activity that will seriously damage or endanger other parties.

Further conditions for whistleblowing require that the action should have a reasonable chance of success in correcting the wrong, and that serious attempts to eliminate the transgression through regular channels have failed.

The wrong should be significant enough to justify all the collateral damage that disclosure brings to the whistleblower, his family, colleagues and the company.

In some circumstances, whistleblowing is justified and may also be deemed morally obligatory - when the gravity of the wrong involves major harm to society or a serious violation of basic moral or human rights, and when the individual is the only one in a position to report the harm.

Another instance of an obligation to whistleblow is when it is part of a person's fiduciary duty, as in a professional role of auditor, lawyer, or environmental engineer. For professionals, the dilemma between the duty to report wrongdoing, and client or employer confidentiality and trust, creates personal disquiet.

This is one of the greatest causes of worry to practising professionals and was expressed at a recent professional ethics seminar held at the UCD Business School.

Organisations should refrain from actions that give rise to whisleblowing in the first place. But in reality, such actions occur so measures should be in place to eliminate them before whistleblowing becomes the final resort. Three measures have been suggested:

Build procedures for reporting bad news into the everyday way of doing business. This has strategic as well as ethical merit.

Staff will understand the benefits of reporting bad news if it is used constructively for learning purposes. Those who report bad news should not be punished, or held responsible for others' wrongdoing.

Build communication channels for reporting bad news. Use outside audits to examine the evidence objectively.

Meanwhile, potential whistle blowers might think about how to avoid this ultimate step. First, choose an organisation with integrit which utilises bad news. It is imperative not to be isolated and to find like-minded colleagues. Presentational skills are important: how to relate bad news in a constructive light, not antagonistically.

Show how the long-term interests of all are served by dealing with an issue sooner rather than later.

Of course, there will always be situations where nothing can deter institutions from malpractices. And those who dare to tell the truth as they see it will cause suffering, not least to themselves - in the cause of avoiding even greater harm for society at large.

Dr Eleanor O'Higgins is a lecturer in strategic management and business ethics at UCD Graduate Business School